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representatives vote 2024-02-28#3
Edited by
mackay staff
on
2024-03-14 14:23:11
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Title
Bills — Help to Buy Bill 2023, Help to Buy (Consequential Provisions) Bill 2023; Consideration in Detail- Help to Buy Bill 2023 and another - Consideration in Detail - Cooperation with lenders and ministerial directions
Description
<p class="speaker">Zoe Daniel</p><p>by leave—I move amendments (1) to (3) as circulated in my name together:</p>-
- The majority voted against amendments introduced by Fowler MP [Dai Le](https://theyvoteforyou.org.au/people/representatives/fowler/dai_le) (Independent), which means they were rejected.
- ### Amendment text
- > *(1) Clause 7, page 6 (line 21), omit “property; or”, substitute “property; and”.*
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- > *(2) Clause 7, page 6 (after line 21), at the end of paragraph (1)(a), add:*
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- >> *(iv) cooperates with lenders to support the individual’s or individuals’ eligibility for a loan, and ability to obtain a loan, relating to the residential property; or*
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- > *(3) Clause 25, page 17 (lines 16 and 17), omit paragraph (2)(b), substitute:*
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- >> *(b) the number of residential properties in relation to which Housing Australia may enter into Help to Buy arrangements, taking into consideration the current demand and need for housing;*
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- > *(4) Clause 25, page 17 (lines 20 and 21), omit paragraph (2)(d), substitute:*
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- >> *(d) the amount, or amounts, that Housing Australia may contribute under Help to Buy arrangements in order to enable individuals to obtain home loans with lenders;*
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- >> *(e) the categories of individuals who will have priority under the Help to Buy Program, such as single parents, victims of domestic violence or individuals of a low socio-economic background.*
<p class="italic">(1) Clause 3, page 2 (line 14), before "The object", insert "(1)".</p><p class="italic">(2) Clause 3, page 2 (after line 18), at the end of the clause, add:</p><p class="italic">(2) This includes assisting cohorts of individuals who have historically experienced disadvantage or exclusion when attempting to buy homes.</p><p class="italic">Note: An example of such a cohort is single women who are at or near retirement age.</p><p class="italic">(3) Clause 45, page 33 (after line 22), after subclause (1), insert:</p><p class="italic">(1A) Without limiting subsection (1), the review must consider the extent that the operation of the Help to Buy program has assisted the cohorts of individuals referred to in subsection 3(2) to buy homes.</p><p class="italic">Note: Subsection 3(2) refers to cohorts of individuals who have historically experienced disadvantage or exclusion when attempting to buy homes.</p><p>I appreciate the consideration the minister has given me in discussing this amendment. I and other crossbenchers have expressed our concerns that, apart from a general comment in the explanatory memorandum for this legislation about the increasing struggle that low- and middle-income earners confront in trying to own their own home, the bill itself is devoid of any mention of who exactly the government hopes will benefit.</p><p>At the last election I campaigned specifically, and have since, to improve women's equality and equity, and housing is just one of the areas where women are notably disadvantaged. ABS data shows that today just 55 per cent of the poorest 45- to 55-year-olds own their own home, down significantly from 71 per cent four decades ago. All the indications are that women are overrepresented in that cohort. The Grattan Institute, which proposed a shared-equity scheme very similar to this initiative taken by Labor to last election, says that it would be of specific benefit to women approaching retirement who would not otherwise qualify for a mortgage and would live their later years without the certainty of a roof over their heads or worse. This amendment would add a specific reference to women in the object of the legislation as well as other historically disadvantaged individuals to make sure that this program is geared to the people who most need it. It would also provide a prod to Housing Australia and those in the states and territories responsible for administering the program that they should be cognisant of historically disadvantaged groups among the low-income individuals that the legislation is designed to assist.</p><p>I understand the minister will not agree to the amendments, in large measure because of the complexity of negotiating agreements with eight state and territory governments to get the program off the ground. That said, I would ask then that reporting on the program is sufficiently comprehensive and detailed to enable us to know for sure in a timely way that it is assisting the cohorts it aims to help, especially women.</p> <p class="speaker">Michael Sukkar</p><p>I think it was a very good question asked by the member for Goldstein: What is the objective of the government? Why such little detail? Not only has the question of who the government are seeking to assist here been asked on multiple occasions but a succession of other questions have gone unanswered. Again, I reiterate the point that I think people would understand, if the government was particularly swift in bringing this legislation forward shortly after the election, that there could be some holes in the bill but here we are, now 20 months into the government.</p><p>This is more than 12 months later than when it should have started and there is a succession of questions that lead one, as the member for Goldstein has, to ask: What is the objective and expectation of the government under this scheme? The questions that have been asked by this side of the chamber that have gone unanswered include the following: What is the assumed return on equity over the medium term of this measure, particularly the way it has been budgeted for? Will the income thresholds be indexed? That will obviously be on the authority of the minister. What are the instances in which the government would force a sale? What are the instances in which a government would say to a homeowner, 'We require repayment of our 40 per cent of equity'? Will that occur when that person gets a pay rise of $1 over the threshold that was an eligibility requirement to begin with? Will it be when the person potentially goes into arrears on their loan? What are the circumstances in which the government will demand its equity back?</p><p>Because if the government is going to budget for this the way it has, it must be expecting a return on its investment. In order to obtain a return on its investment, there must be circumstances in which the government will essentially foreclose on a homeowner and say, 'We want our 40 per cent back now.' Will that occur at a time when a homeowner is in negative equity? Will it be in an instance when there is a downturn in the economy? When house prices reduce, where you have negative equity, will the government foreclose in those circumstances?</p><p>In the end, the way the government is budgeting for the measure, it will get a return on its investment, a return on the $5.5 billion of equity that it is borrowing. Mind you, what are the debt costs associated with that $5½ billion? We know the government will have to draw down $5½ billion for the 10,000 places per year. What is the government bond rate it will pay on that? How many hundreds of millions of dollars in debt servicing payments will be attached to that? And that gets us to the next question: If we have seen throughout the country that these schemes are chronically undersubscribed for all the reasons we have outlined—that people don't want the government forcing them to sell their home—what has the department modelled in relation to the uptake of this product? Because, again, the scheme in New South Wales has only been able to deploy six per cent of the available places.</p><p>Even though we've got a headline of 10,000 places being available, does the government promise that every single one of those 10,000 places will be taken up? For budgetary purposes, have they modelled that every one of those places will be taken up, or does their modelling reflect that it's very unlikely that anywhere near 10,000 places will be taken up? Again, to go back to my earlier questions, we need clarity about the responsibility of the Commonwealth, as a co-owner of the property, for repairs and maintenance or for improvements. What is the experience that we've seen from state based schemes? Whilst we're in the midst of a housing crisis—first home buyers at record lows, new home starts at record lows, approvals at record lows, rents rising at 26 per cent—the priority of this government needs to be much bigger than replicating programs that already exist at a state level in this country and that are already going unused.</p> <p class="speaker">Julie Collins</p><p>I thank the member for this amendment. I have had a good discussion with her about it. She knows that this scheme is specifically targeted at low- and middle-income Australians. I appreciate where she's coming from with this amendment. I think the amendments from the crossbenchers are well-intentioned, but, as I pointed out, we have to consult with every state and territory on amendments because of the way this scheme would work. The disadvantaged and low-income people that it would support are people that otherwise wouldn't get into homeownership, and we would expect that a large proportion of those would be women. Certainly, in our reporting, we intend to report on the types of cohorts being supported. I wanted to let the member know that in Western Australia's Keystart around 66 per cent of the shared-equity participants have indeed been women. We won't be supporting the amendment.</p> <p class="speaker">Kylea Tink</p><p>I rise to speak in support of the consideration-in-detail amendments moved by the member for Goldstein. I think it's really important we acknowledge that there is some merit in this program. I want to say to the minister: I know that there have been people across the sector calling on the federal government for a program exactly like this for a period of time. I also want to acknowledge that I do believe there are people who will benefit from this program. I think the issue here is that, as a parliament, we have no line of sight of who those people will be, except for some very limited commentary in an explanatory memorandum committing it to be targeted specifically to low- and middle-income families.</p><p>I understand that the federal government is working in the very complicated environment that is our federated system, but I can't help but think there is something slightly off kilter. We are entering into this saying we can't decide what we're going to do until we've consulted with the states and territories, but the first step in consultation should always be in this House. As the legislation stands, we're being asked, as a parliament, to basically trust that the government will make sure this is allocated in a way which would be in keeping with our expectations. Trust is a very valuable asset. It's something that's earned, not necessarily given straightaway. At the moment, the details are just not in this piece of legislation, and this amendment would go some way to tightening those details up.</p><p>Question negatived.</p> <p class="speaker">Dai Le</p><p>by leave—I move amendments (1) to (4), as circulated in my name, together. In the past week, my fellow members and I have discussed the Help to Buy Bill widely. It is safe to say, as we've heard already, that we're all concerned by the current state of the bill. The bill was meant to bring a ray of hope to Australians dreaming of owning a home, with its name being the starting point. However, it is confusing. There are no certainties with trying to own a home in such trying times.</p><p>Good policy requires some degree of relatability to the public we seek to serve. I previously outlined in my speech on the second reading the shortcomings of the bill. We are in a housing conundrum involving supply and demand. The Help to Buy Bill only seeks to provide access to ownership. It doesn't address shortages of supply, which we all know is the critical issue, or the affordability of buying, which is out of reach for many working Australians.</p><p>A young constituent named Mario in my electorate of Fowler shared his concern that this bill is 'too vague on who it gives preference to' and that the 'applicant pool is too large relative to the number of available places'. My amendments seek to address the opaqueness of the bill by requiring that matters covered by ministerial directions under the Help to Buy program specifically include:</p><p class="italic">(b) the number of residential properties in relation to which Housing Australia may enter into Help to Buy arrangements, taking into consideration the current demand and need for housing;</p><p>Ten thousand places per year are not enough. There should also be direction as follows:</p><p class="italic">(e) the categories of individuals who will have priority under the Help to Buy Program, such as single parents, victims of domestic violence or individuals of a low socio-economic background.</p><p>This also includes those of cultural background and in regional areas. This is important as we need to ensure that individuals who are disadvantaged and vulnerable are not left at the bottom of the barrel or left behind. The amendment also includes:</p><p class="italic">(d) the amount, or amounts, that Housing Australia may contribute under Help to Buy arrangements in order to enable individuals to obtain home loans with lenders;</p><p>The current reality that we're living in is that buying a home is not an affordable feat even if the government is offering to chip in 30 to 40 per cent for a purchase price of approximately $950,000. Young constituent Mario, who is very passionate about this topic, gave me a graph of the median house prices in various suburbs of Fowler. He had deduced that the median house price was over $1 million. A significant number of my constituents do not have $90,000 or close enough to buy a million-dollar home. Even if they did earn $90,000, a local broker has shared that the individual can expect to borrow approximately $410,000. An individual's median income in Fowler is $521 per week, which they must spread thinly across raising the kids, bills, food, HECS debt and general expenses. When lenders are looking at the borrowing capacity for a home loan, as we all know, it's very challenging, but these individuals would be very lucky to get offered even $300,000, especially with the increasing interest rates. If the individual has been in credit card debt or finance vehicles, their chance of getting a sufficient loan becomes even more obscure.</p><p>My biggest concern still lies with young people being unable to obtain a loan as they have accumulated a HECS debt that is subject to indexation and rises with CPI. I've said it before and will say it again: we need to freeze indexation in order to give young people a push in life. It is concerning to me that we are not taking this seriously enough. Lenders will look at a young person's borrowing capacity together with their HECS debt and refuse to give them an adequate loan. Where is the equity there? We should try to close the gap of disadvantage and really help those in need.</p><p>In my view, Housing Australia, on behalf of the government, should do more than just give cash. Another amendment that I have proposed is that there be a statutory obligation on Housing Australia to cooperate with lenders to support an individual's eligibility for a loan and ability to obtain a loan relating to residential property. This could be in a form adjusting the contribution or a letter of support. Such help can go a long way. I therefore ask the government to consider the amendments holistically so that we can truly provide the help needed to Australians dreaming of owning a place that they can call their own home.</p> <p class='motion-notice motion-notice-truncated'>Long debate text truncated.</p>-
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